The fall of Kona Bikes :(

[72gmc]

Originally Posted by AngryScientist

Man, that is some BS. Treating employees like that is top level classlessness.

Picking a team to prepare for, travel to and set-up for a big event like sea otter, only to tell them break it down and there will be a town-hall next week is just heartless, soulless garbage.

There is a right and a wrong way to make an exit.

This is what happens when the people making decisions are not the people who built the business.

[EB]

Originally Posted by 72gmc

This is what happens when the people making decisions are not the people who built the business.

This is correct, from 2022:

https://www.bicycleretailer.com/indu...-outdoor-group

Kona Bicycles has been acquired by Kent Outdoors, a Ohio-based company that was known until Wednesday as Kent Water Sports. Kent Outdoors owns several outdoor sports and watersport brands, including the Arbor snowboard brand. Kent Outdoors is no relation to Kent International, the New Jersey-based mass market bicycle brand.

...

A year ago, Seawall Capital, LLC acquired Kent Water Sports. At the time, Kent Water Sports' portfolio included more than 15 brands, including HO/Hyperlite, Connelly, O’Brien, Liquid Force, Onyx, Aquaglide, Barefoot/Fatsac and Arbor Snowboards (managed by agreement with the Arbor Collective).

Private equity strikes again.

[72gmc]

My Kona experiences come from the aughts and 2010s when cyclocross was booming here in the PNW. My oldest and I would attend Starcrossed and a few other events each year, so we said hi to the twin towers on an annual basis. My sweet kid made a bit of a race-day friend of Ann Grande. Never met the Kenny and Becky Show of more recent years, but I'm a fan from a distance. Everyone I met with a Kona association had a good vibe.

[Spaceman Spiff]

Originally Posted by unterhausen

I feel like selling bikes 2 for 1 might have been a clue, but I dunno, I'm not a bike industry genius.

When I first saw that promotion, I was super excited. Once I'd thought about it some more, I realized that it was probably a bad omen...

I have a 2009 Kona Unit, 2017 Kona Hei Hei, and a 2016 Kona Esatto Ti. Kona bikes have always fit me well, worked well for me, and seem to be well-made bikes. If they are going under, I should buy a replacement derailleur hanger for each bike and a bearing kit for the Hei Hei. *sigh*

[RWL2222]

From wikipedia....



Kona Africabike

In 2006, Kona began its largest advocacy effort to date - BikeTown Africa. The Kona Africabike was a bike built in partnership with Bristol-Myers Squibb and Bicycling Magazine. The Kona Africabike was designed specifically to assist health care workers treating HIV and AIDS patients with the delivery of home health aids and other services in African Cities, starting with Bobonong, Botswana and Gaborone, Botswana. More recent projects have included Delft and Stellenbosch.
For 2008, Kona pledged to donate 1,000 Africabikes for the project and due to the overwhelming customer support of this project, Kona set up a non-profit/humanitarian organization from their European HQ in Geneva, Switzerland called Kona Basic Needs. This organisation's aim is to continue to raise more funds and awareness of the Kona Africabike program and to continue the donation of these bikes. [citation needed].


see also: https://road.cc/content/review/4027-kona-africabike-3

[November Dave]

Originally Posted by unterhausen

I feel like selling bikes 2 for 1 might have been a clue, but I dunno, I'm not a bike industry genius.

Obviously a Hail Mary to turn inventory on hand into cash, as you know. If this had the response they were praying for, presumably they would at least have cash to keep the lights on and materials coming in. But you're then still left with the damage to your brand, the damage to your dealer relationships, etc, all of which leads to the next round of hard things to deal with.

It was incredibly scary in April 2021 to realize that the flow of available inbound materials could not result in us meeting revenue needs. Fortunately our consequences for this didn't include laying a bunch of people off, stiffing suppliers, leaving a bunch of unsupported customers, etc. Also fortunately, the shim business was growing enough to make up some of the shortfall and we that supply never faltered, we still had vibrant demand for wheels, and the affected people (just 2 of us) could easily adapt and survive. But there weren't very many good choices available then, and since then a slew of industries have shown us just how easy it's been to make bad decisions since.

My guess is that this won't be the last of these.

[redir]

Originally Posted by 72gmc

My Kona experiences come from the aughts and 2010s when cyclocross was booming here in the PNW. My oldest and I would attend Starcrossed and a few other events each year, so we said hi to the twin towers on an annual basis. My sweet kid made a bit of a race-day friend of Ann Grande. Never met the Kenny and Becky Show of more recent years, but I'm a fan from a distance. Everyone I met with a Kona association had a good vibe.

Fond memories of getting lapped by Ryan Trebon (Tree Trunk) on his big blue Kona, that still looked small on him.

[vertr]

Originally Posted by unterhausen

I feel like selling bikes 2 for 1 might have been a clue, but I dunno, I'm not a bike industry genius.

Specialized has been clearing out 2023 MTBs for 50% off for a while, which is pretty much the same thing except you don't get two bikes (so it's a better deal).

[jcs7282]

Originally Posted by benb

Are there any boutique builders or factories the size of Seven, Moots, IF, etc.. who are in trouble?

Seven itself has been shedding some employees as of late...

[whatshubdoc]

Originally Posted by benb

Are there any boutique builders or factories the size of Seven, Moots, IF, etc.. who are in trouble?

From the MTB world, POLE bikes just went bankrupt. EVIL bikes did some downsizing. ORANGE went out, then came back (I think?). Ibis is getting leaner (selling less peripheral things like decals, touchup paint, merch). Those are the ones that come to mind.

All City just got axed from the QBP lineup last month.

Canyon seems to be doing OK due to MVDP?

[prototoast]

Originally Posted by whatshubdoc

From the MTB world, POLE bikes just went bankrupt. EVIL bikes did some downsizing. ORANGE went out, then came back (I think?). Ibis is getting leaner (selling less peripheral things like decals, touchup paint, merch). Those are the ones that come to mind.

All City just got axed from the QBP lineup last month.

Canyon seems to be doing OK due to MVDP?

From some numbers released late last year, Canyon's revenue was up, but had a small loss. https://www.bicycleretailer.com/inte...three-quarters

For larger companies, having profits that fluctuate over the business cycle is a perfectly normal thing, and is also plausibly profit-maximizing in the long-term.

For the very small players, they generally need to be profitable every year to finance their ongoing operations. In between, it can go either way.

[Mark McM]

Originally Posted by benb

Are there any boutique builders or factories the size of Seven, Moots, IF, etc.. who are in trouble?

Parlee Cycles went through a Chapter 11 bankruptcy last year. and was essentially "saved" when it was bought by a private investor:

https://www.cyclingweekly.com/news/p...clist-investor

[benb]

Originally Posted by whatshubdoc

From the MTB world, POLE bikes just went bankrupt. EVIL bikes did some downsizing. ORANGE went out, then came back (I think?). Ibis is getting leaner (selling less peripheral things like decals, touchup paint, merch). Those are the ones that come to mind.

All City just got axed from the QBP lineup last month.

Canyon seems to be doing OK due to MVDP?

Which of these companies actually make their own bikes as opposed to ordering them up from Taiwan?

POLE sounds like the only one that manufactures all their own bikes.

IBIS makes a limited # themselves but outsources most (bonus points for seemingly moving some back)

Orange makes some themselves and outsources the rest

Canyon is outsourced AFAIK

All City is outsourced

My conjecture was just that actually manufacturing your own bike would have put a brake lever on the desire to massively increase production during 2020-2021 which seems to be where so much trouble started.

If Seven has had to lay people off that's interesting. I thought Parlee was more just long term failure as opposed to the supply/demand cycle issues that are hitting most companies right now. Parlee is also partially outsourced now too.

[jcs7282]

Originally Posted by benb

If Seven has had to lay people off that's interesting.

I know someone directly impacted by the changes there, so, can confirm.

[unterhausen]

Originally Posted by vertr

Specialized has been clearing out 2023 MTBs for 50% off for a while, which is pretty much the same thing except you don't get two bikes (so it's a better deal).

I'm curious if these sales are being funded by dealers who are carrying existing stock. I got the impression that the local Kona dealer wasn't too happy about the sale. The local spesh store is company-owned, so who cares?